SHOW ALL WORKINGS The Investor acquired 75% of Investee on January 1, 2020 for $105,000. At acquisition the fair value of the noncontrolling interest was $35,000. Trial Balances for the two entities at December 21, 2020 are INVESTEE Debit Credit 32,000 14,000 24,000 25,000 150,000 Cash Accounts Receivables Inventory Land Buildings & Equipments Investment in Subsidary Cost of Good Sold Wage Expense Depreciation Expense Interest Expenses Other Expense Dividends Declared Accumulated Depreciation Account Payable Wages Payable Notes Payable Common Stock Retain Earnings Sales Income from subsidary Total INVESTOR Debit Credit 68,500 85,000 97,000 42,875 350,000 118,875 145,000 35,000 25,000 12,000 23,000 30,000 170,000 51,000 14,000 150,000 200,000 126,875 290,000 25,500 1,032,250 $ 1,027,375 114,000 20,000 10,000 4,000 11,000 20,000 50,000 15,000 6,000 50,000 55,000 48,000 200,000 $ $ 424,000 $ 424,000 The book value of the investee's assets are equal to the fair value except for Building & Equipment which are worth $25,000 more. Building and Equipment have 10 years of remaining life at time of acquisition Required 1. Allocation of Acquisition Value 2. Equity entries for 2020. 3. Worksheet entries for the 2019 year end consolidation SHOW ALL WORKINGS The Investor acquired 75% of Investee on January 1, 2020 for $105,000. At acquisition the fair value of the noncontrolling interest was $35,000. Trial Balances for the two entities at December 21, 2020 are INVESTEE Debit Credit 32,000 14,000 24,000 25,000 150,000 Cash Accounts Receivables Inventory Land Buildings & Equipments Investment in Subsidary Cost of Good Sold Wage Expense Depreciation Expense Interest Expenses Other Expense Dividends Declared Accumulated Depreciation Account Payable Wages Payable Notes Payable Common Stock Retain Earnings Sales Income from subsidary Total INVESTOR Debit Credit 68,500 85,000 97,000 42,875 350,000 118,875 145,000 35,000 25,000 12,000 23,000 30,000 170,000 51,000 14,000 150,000 200,000 126,875 290,000 25,500 1,032,250 $ 1,027,375 114,000 20,000 10,000 4,000 11,000 20,000 50,000 15,000 6,000 50,000 55,000 48,000 200,000 $ $ 424,000 $ 424,000 The book value of the investee's assets are equal to the fair value except for Building & Equipment which are worth $25,000 more. Building and Equipment have 10 years of remaining life at time of acquisition Required 1. Allocation of Acquisition Value 2. Equity entries for 2020. 3. Worksheet entries for the 2019 year end consolidation
